AUD/USD analysis: bullish extension could target 0.7361

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7266

Wall Street, base metals, underpin the Aussie now at September highs.
Bears took a step back, may return on a break below 0.7225.

The Aussie was among the best performers this Wednesday, with the AUD/USD pair rising to 0.7274, a new September high, on the back of soaring US equities. The pair hardly reacted to risk-related headlines that gave the greenback a short-lived intraday respite against its European rivals, and kept advancing firmly, but steadily, breaking through a couple of relevant resistance levels. Further gains in base metals and comments from Chinese premier Li Keqiang added to the positive mood around the AUD, as he said that the country will accelerate its process of opening up, cheering globalization moving forward. He added that the country won't devaluate its currency to stimulate exports, ruling out currency manipulation as a tool to fight the US tariffs. The RBA will release today its monthly bulletin, but given that is a compilation of already known events, it doesn't have the ability to affect prices.

As for the technical picture, the pair is currently trading above the 61.8% retracement of its latest daily slump at around 0.7255, now the immediate support. As long as it holds, the pair has room to extend its advance up to the 0.7361, August 28 high. In the 4 hours chart, the pair is now above all of its moving averages, with the 200 SMA covering and reinforcing the mentioned Fibonacci support, and the 20 SMA crossing above the 100 SMA below it. Technical indicators have lost upward momentum but remain within overbought territory, not enough to confirm an interim top.

Support levels: 0.7255 0.7225 0.7190

Resistance levels: 0.7300 0.7330 0.7360

View Live Chart for the AUD/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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